> So if your product gets 20% better with each iteration and you do 12 iterations in a year, it’ll be 1.219x better after a year.
Not even close. If your product gets 20% better with each *iteration* and you do 12 a year, it'll be 1.2^12 = 8.9x better after a year. The calculation you did is for if the "interest rate" (uncompounded annual rate of improvement) is 20%.
> So if your product gets 20% better with each iteration and you do 12 iterations in a year, it’ll be 1.219x better after a year.
Not even close. If your product gets 20% better with each *iteration* and you do 12 a year, it'll be 1.2^12 = 8.9x better after a year. The calculation you did is for if the "interest rate" (uncompounded annual rate of improvement) is 20%.